Given a choice of similar providers, consumers tend to patronize the merchant that provides the consumer more value for the same price, or the same value at a lower price. To influence a consumer's choice of providers, merchants often provide promotions, such as coupons, for goods such as groceries, consumer electronics, clothing, and other items. In this context, a coupon is a promotion used as a tool by merchants to encourage sales and/or loyalty, usually by lowering the price in some manner. For example, a coupon could be used for a discount on the product, to give the consumer a larger quantity (for example, 2 for 1) of a product or service, or a discount on a related product or future purchase. A coupon could also be used to credit purchases made by one person against a certain account. The possibilities for coupon usage are essentially unlimited.
Coupons and other promotions are often used by merchants as marketing tools designed and developed to encourage a change in purchase behavior, to retain valued customers and to induce repeat purchases. Traditional promotions have been paper-based, and usually have a cash or material purchase value, such as prepaid gift cards. Rather than being directed toward a single product, they may be an incentive to buy accessories associated with a particular item, or promotions may even be offers to sell. Overall, promotions serve to attract consumers to a store or to a particular product or brand in a store, as well as to bring attention to new products and to keep track of an individual consumer's buying habits.
Customers often do not fully consider the coupons or offers that they are exposed to prior to entering a store. For example, a customer may view a coupon in a newspaper circular but elect not to clip the coupon for later use in the store. This may be due to a variety of reasons, among others including, the customer does not recognize a present use for the coupon or does not think that he/she wants to take the take the time to clip the coupon. However, when the customer later enters the store, he/she may recognize a use for the previously viewed coupon but does not possess the coupon. In other circumstances, the store may want to influence a customer to purchase certain items, but other than lowering the price of the item and advertising that lower price, the store has limited options to change the behavior of the customer upon entry into the store, assuming the customer has not brought coupons with him/her to the store.